Closing post
Time to wrap up….
Here are today’s main stories, first on Entain’s settlement:
The problems at HSBC today:
Black Friday:
And in other news…
Full story: Hundreds join Amazon picket line for Black Friday strike
Hundreds of strikers outside Amazon’s Coventry warehouse were joined on Black Friday by trade unionists from Europe and the US as part of a global campaign calling for better working conditions at the internet retailer.
Wearing orange beanie hats branded with the GMB union logo, activists from Germany, Italy and California, on strike at their respective Amazon workplaces, expressed solidarity with the Coventry strikers, who have taken 28 days of industrial action since January.
Gathered on a grassy roundabout close to the vast warehouse in the chilly early morning air, scores of the activists from the Make Amazon Pay campaign joined in chants of: “What do we want? £15! When do we want it? Now!”
Back at Amazon, the GMB union have held a demonstration in support of the striking workers outside the e-commerce giant’s UK headquarters in London.
Entain reaches settlement in Turkish bribery probe
Newsflash: Gambling group Entain has reached angreement to pay over £600m to resolve an investigation into alleged bribery related to a scandal at its former Turkish business.
Entain, which owns Ladbrokes and Coral, has reached a Deferred Prosecution Agreement (DPA) with the Crown Prosecution Service (CPS), over historic corporate misconduct at its former Turkish online betting business.
Entain will pay a financial penalty plus disgorgement of profits totalling £585m – which matches the sum it set aside in August to cover the issue. It is also making a charitable donation of £20m and will pay £10m towards HMRC and the CPS’s costs.
Entain’s chairman, Barry Gibson, says:
“This legacy matter concerns a business which was sold by a former management team six years ago.
The Group has changed immeasurably since these events took place, and the DPA process has provided a reminder of the stark differences between the GVC of yesterday and the Entain of today.
We are committed to continuing our journey towards operating only in regulated markets, and are now widely recognised as a best-in-class, responsible operator with the highest levels of corporate governance across all aspects of our business.”
Entain will now seek final judicial approval from the Court on 5 December 2023. The DPA is a voluntary agreement, and Entain says it would “fully resolve the HMRC investigation into these matters insofar as they concern the Company and the Group”.
The investigation included potential breaches of section 7 of the UK’s Bribery Act, which relates to companies failing to prevent an individual taking part in bribes that benefit the business.
The owner of the Mirror and Express has been granted legal permission to implement a financial move to reassure shareholders that they will continue to be paid dividends, weeks after the newspaper group axed 450 jobs in a major cost cutting drive.
Reach, which also owns scores of regional UK titles including the Manchester Evening News, Birmingham Mail and Liverpool Echo, has received approval from a specialist court to cancel the £605m credit balance of the company’s share premium account.
When Reach announced the proposed maneuvre, which was approved by shareholders at a vote held at a general meeting earlier this month, the company said it would allow it “to give reasonable assurance” that the business would be able to continue to make “distributions to shareholders”.
While the company said at the time that the financial engineering would not involve any immediate payment or return of a capital to shareholders, or a change to the dividend policy, it would result in “the creation of distributable reserves of the same amount”.
On Friday, the Insolvency and Companies Court approved the capital reduction plan with Judge Sally Barber ruling that she was satisfied that following the move there was “no real likelihood” of Reach being “unable to discharge” debt payments as they become due.
Times are tough at Big Four accountancy group KPMG.
The FT reports today that KPMG has frozen pay for around 12,000 employees in the UK, as demand for services across the firm slows. Bonuses are also be cut, as the slowdown i dealmaking this year hits revenues.
KPMG had previously frozen pay for its deal advisory staff, where 125 jobs were being cut, but it has now decided to prioritise pay rises for employees who are getting promoted. More here.
Breaking news: KPMG has frozen pay for around 12,000 employees in the UK as a prolonged slowdown in dealmaking hits the big four firm https://t.co/GqCM5lbKsa pic.twitter.com/VVUgLmgnWo
— Financial Times (@FT) November 24, 2023
Back on Black Friday spending, lender Nationwide has reported that its customers had made 3.22 million transactions by noon today – which is 5% more than a year ago.
It’s also 14% more than a typical Friday.
Mark Nalder, director of payment strategy at Nationwide Building Society, explains:
“Many people have spent the morning looking for Black Friday discounts.
The number of purchases has been in line with what we predicted - up five per cent on last year and 14 per cent on what we see on a typical Friday. Historically the upcoming lunchtime period has been the peak time for spending as people search for bargains either online or on the high street during their break.”
Seperately, Barclays has reported that transations in the last week are higher than a year ago, as retailers continued to launch sales earlier in the month.
Barclays found that transactions in the last week were 1.4% higher than last year, and also 2.25% higher than a month ago.
Marc Pettican, head of Barclaycard Payments said:
“Over the last few years we’ve seen Black Friday sales arrive earlier and earlier, with shoppers spreading their spending over a longer period of time. Although the cost-of-living may be impacting some shoppers’ spending on non-essential items, many are still taking the opportunity to bag a Black Friday bargain. No doubt this will be welcome news to retailers who may have anticipated a slower November as shoppers’ budgets continue to be squeezed.
“It’s also encouraging to see that transaction volumes this week reflect a much busier shopping period than a regular week within the year, too. Retailers will undoubtedly hope that sales remain strong throughout today and over the weekend.”
It's Madness at HMV reopening
Over on Oxford Street, classic British band Madness have shown up for the reopening of HMV’s store.
The historic Oxford Street outlet is opening again after a four year hiatus, after HMV fell into administration in 2019.
The retailer was rescued from insolvency by Canadian Doug Putman’s Sunrise Records business. Putman has said he hopes the shop can have “crowds which will shut down the street” again.
As well as Madness, other acts including the South African singer Baby Queen and the rock bands Hard-Fi and the Reytons were performing today.
Putman told the Guardian that HMV, which currently has more than 100 stores across the UK, had seen total sales rise this year, with sales of CDs up for the first time in more than a decade.
Putman said CDs had regained appeal because they were now relatively cheap and there was also a “doubling down on trying to buy everything [a band] comes out with”. Taylor Swift’s album reissues are selling across all formats, for example.
More here:
Advice for HSBC customers
Anyone caught up in the HSBC technical problems should keep a record of any extra costs they incur, says Sam Richardson, deputy editor of Which? Money.
Richardson explains:
“This HSBC outage will cause a real headache for a lot of its customers. In the worst cases it could prevent people making essential payments such as rent and bills, but it also falls on Black Friday, one of the busiest shopping days of the year, where many people will be looking to make significant savings on big-ticket items.
“We strongly advise customers that have been left out of pocket to keep evidence of extra expenses they may have incurred as a result of the outage, so they can be claimed back from HSBC.
“People want a bank they can depend on, and if IT outages become a regular occurrence, consumers could be tempted to vote with their feet and switch to an alternative provider – particularly with a lot of tempting switching incentives on offer at the moment.
“Having a back-up bank account or credit card can help, by giving consumers a way to make essential payments during outages like these.”
Updated
Today is turning into a bleak Friday for UK computer games developer Team17.
Older readers may remember Team17 from its rather fine 1990s classic Worms (in which your small group of worms, armed with guns, missiles, and bespoke kit like a holy hand grenade or exploding sheep, fought other wriggly platoons).
Anyway, things aren’t going so well this year.
Team17 told shareholders this morning that some titles are not meeting sales expectations, while it has been “too slow” to address some project overspends.
Overall, the company insists that it is well positioned, and expects revenues this year to be modestly ahead of current market expectations.
But investors have sent its shares down by over 40% today.
That’s a blow to founder Debbie Bestwick, who still owns a fifth of the company. Her stake has fallen by almost £40m today. Bestwick announced in March she would step down by the end of the year.
The problems at HSBC UK are understood to have been caused by an “internal systems issue”, says PA Media.
Boots sale could be revived as pension scheme is offloaded
Elsewhere in the UK this morning, Boots is paying £670m to offload its £4.8bn pension scheme to Legal & General.
The buy-in deal insures all 53,000 members in the Boots Pension Scheme, making it the largest single transaction of its kind ever in the UK, my colleague Sarah Butler explains.
To facilitate the deal, Boots will bring forward about £170m of already committed payments to the Scheme and has committed to pay extra contributions expected to be approximately £500 million.
The deal could help revive a process for the sale of Boots by its US owner Walgreens. An earlier sales plan was abandoned in June last year, and is thought to have been partly scotched by potential buyers’ concerns about Boots’ guarantees on the pension scheme that were thought to be worth billions of pounds.
John Ralfe, the independent pensions expert who once oversaw Boots’ pension scheme, said the buy-out deal was “good news for members” as there benefits would be unaffected and they were now supported by a “properly capitalised and regulated business.”
Credit rating agency S&P Global has weighed in on Jeremy Hunt’s autumn statement
They point out that the tax cuts announced by the chancellor will not held rebuild the UK’s diminished fiscal headroom (Hunt having spent most of a windfall from lower borrowing and expected higher tax receipts).
S&P Globl point out that the public finances will benefit if the UK economy does better than expected next year, but add:
“Stabilizing or reducing public debt levels will remain a key challenge.”
Full story: Thousands of HSBC customers in UK unable to access online banking services
Thousands of HSBC customers have reported that they have been unable to access its online and mobile banking services on one of the busiest online shopping days of the year as consumers swoop on Black Friday retail deals, my colleague Mark Sweney writes.
More here.
Updated
HSBC: We're really sorry
HSBC UK has now said it is “really sorry” about the disruption.
It also advises customers that they can use a one time passcode, sent by text message, to authorise an online card purchase if they’re having problems with their app.
We’re really sorry if you’re impacted by a disruption to Online and Mobile Banking right now. If you’re not able to authorise an online card purchase via the app, you can opt for a one time passcode via SMS. We’ll share updates here.
— HSBC UK (@HSBC_UK) November 24, 2023
HSBC’s mobile banking app is now suggesting that a ‘system upgrade’ is taking place:
Ah yes, a system upgrade on Black Friday. Nice one @HSBC_UK 😂 pic.twitter.com/YRSvfdHM5F
— Cupcakes & Snowsters ☃️ (@cupcake_coaster) November 24, 2023
Black Friday doesn’t seem like the ideal time to schedule an update…
Of course HSBC decide to do their online banking upgrade right in the middle of Black Friday, so I can’t check whether I have enough money for the offer I want because both mobile and PC banking are down 🙄🙄🙄
— Catherine Dunn ♠️🖤 (@CatherineDunn8) November 24, 2023
Updated
Downdetector, a website that tracks online outages, shows that reports of problems at HSBC started climbing around 7am this morning.
Here’s more reaction from HSBC customers to today’s technical outage:
Still having issues @hsbc, got to move some money so I can buy some Black Friday purchases (that I don’t need) Maybe it’s a sign!
— Sarah Leedham (@CarpeDiem123) November 24, 2023
HSBC @HSBC_UK online banking really decided to go down during Black Friday x payday.
— Jennever Pelaez (@jenndpelaez) November 24, 2023
Guess I’ll just save the money 😆
Updated
HSBC UK has apologised to customers and is working to restore its mobile and online banking service, including the authorising of online card purchases via the app, PA Media says.
HSBC hit by mobile and online banking problems
HSBC UK customers hoping to take advantage of Black Friday have been hit by technical problems with their banking services.
HSBC says it is investigating the problems as “as a matter of urgency”, as customers report problems using its app or accessing online banking.
In a post on X (formerly Twitter), HSBC says:
We understand some customers are having trouble accessing banking services as usual right now.
“We’re investigating this as a matter of urgency and will share an update as soon as possible.”
We understand some customers are having trouble accessing banking services as usual right now.
— HSBC UK (@HSBC_UK) November 24, 2023
We're investigating this as a matter of urgency and will share an update as soon as possible.
HSBC’s status page says “some customers are currently experiencing issues logging on to online and mobile banking”, adding that “We are working hard to fix this”.
The technical problems could make it harder for people to transfer money between accounts to pay bills, or to fund Black Friday spending.
Fantastic for a global bank with no branches because online is so good, it’s payday, bills are going out but I can’t transfer my wage to pay them. You gonna pay everyone’s overdraft and late payment charges?
— Trisha (@trishanna81) November 24, 2023
@HSBC please rectify this issue
— IHESIE JUSTINE (@IhesieJ) November 24, 2023
Today is black Friday please pic.twitter.com/0LFXyAEAFe
Updated
Nationwide: Early Black Friday spending higher than last year
Black Friday in the UK has got off to a brisk start, according to new payments data.
Nationwide reports that by 9am, its customers had made 1.49 million transactions - 15% more than a typical Friday.
That’s also 9% higher than on Black Friday 2022, they say.
Mark Nalder, Director of Payment Strategy at Nationwide Building Society, says bargain hunters are already out in force, adding:
“The number of purchases made by 9am is already nine per cent higher than the same period last year and suggests that this year’s Black Friday is going to be the busiest one ever.
BoE chief economist: can't 'declare victory' in battle against inflation
The Bank of England’s chief economist has declared that the BoE can’t relent in its battle against high inflation just because there are signs of weakening economic activity.
In an interview with the Financial Times, Huw Pill said the BoE’s Monetary Policy Committee cannot “declare victory and move on” now that inflation has dropped to 4.6% (which is still double its target).
Pill explained:
There’s slower growth in activity and employment as we’ve discussed. But because I think that is more supply-driven rather than demand-driven, the weakening of activity is not as associated with easing of inflationary pressures.”
BoE must hold firm in battle against inflation, says top official https://t.co/DhGh3plvqH
— FT for Schools (@ft4s) November 24, 2023
This is the latest in a flurry of comments from BoE officials, which prompted Harriett Baldwin MP to accuse them of a “confusing running commentary” about interest rate policy.
Pill himself caused a stir earlier this month when he said market expectations of a rate cut next summer were “not totally unreasonable”.
BoE governor Andrew Bailey then tried to squash such talk, saying it was “far too early” to propose rate cuts.
Updated
Back in Germany, business sentiment has picked up, despite the economy teetering near a technical recession.
German business morale improved for the third month in a row in November, though by slightly less than expected, the latest business climate index from the IFO institute shows.
The index rose to 87.3, up from 86.9, with measure of the current business situation and economic expectations both improving a little.
#Germany's leading business #sentiment indicator, the #ifo index vs. German #GDP growth.
— jeroen blokland (@jsblokland) November 24, 2023
Don't shoot the messenger. pic.twitter.com/YO0L7Skq76
Sunak: Nissan investment will turn Sunderland into EV Silicon Valley
Prime Minister Rishi Sunak has declared that Nissan’s commitment to make electric versions of its Qashqai and Juke crossover SUVs in the UK, plus the new Leaf, will make Sunderland the UK’s electric vehicle “Silicon Valley”.
Sunak says:
“Nissan’s investment is a massive vote of confidence in the UK’s automotive industry, which already contributes a massive £71bn a year to our economy.
“This venture will no doubt secure Sunderland’s future as the UK’s Silicon Valley for electric vehicle innovation and manufacturing.
“Making the UK the best place to do business is at the heart of our economic plan.
“We will continue to back businesses like Nissan to expand and grow their roots in the UK every step of the way as we make the right long-term decisions for a brighter future.”
Full story: Nissan to build three new electric car models at Sunderland plant
Nissan will build three new electric car models at its plant in Sunderland as part of a £2bn investment by the Japanese manufacturer, my colleague Jasper Jolly reports.
The factory will produce three separate crossover models, yet to be named, and the decision will require a third “gigafactory” to supply batteries. That could mean the next-door battery supplier, AESC, will go ahead with previously announced plans to build a third “gigafactory”, subject to negotiations.
The carmaker said the total investment in the Sunderland area, including the battery factories, will reach £3bn, after £1bn was previously pledged. Nissan will invest £1.1bn in the latest phase, and the rest of the £2bn is expected to come from the battery supplier once it is confirmed.
Nissan did not reveal the size of the government subsidy for its investment, although it is understood to be significant in return for assurances that battery production will remain in the UK.
The cost-cutting axe is hovering over staff at Barclays.
Last night, Reuters reported at the bank is working on plans to save as much as £1bn, which could involve cutting as many as 2,000 jobs, mainly in the British bank’s back offic.
A group of Barclays managers, led by CEO C.S. Venkatakrishnan, are said to be reviewing proposals to bolster its profitability.
Reuters explains:
The potential cuts would primarily be at Barclays Execution Services, known internally as ‘BX’, and would form part of an overall target of reducing expenses by up to 1 billion pounds across the group over several years, the person added.
Barclays has made efforts to reduce expenses in recent years by slashing bonuses, as well as jobs in its retail and investment banking businesses, but moves to shrink BX and the potential savings have not been reported before.
Exclusive: Barclays working on $1.25 billion cost plan, could cut up to 2,000 jobs -source https://t.co/T7omcA63IV pic.twitter.com/wGQzpIYvRL
— Reuters Business (@ReutersBiz) November 23, 2023
The cost of living squeeze could push shoppers to second-hand stores, rather than to Black Friday bargains, says Victoria Scholar, head of investment at interactive investor.
Scholar explains:
This year, the timing of Black Friday doesn’t bode well for the retailers given that it falls ahead of payday when workers’ purse strings are typically much tighter. Given that retailers have been heavily discounting items already this year to try to bolster spending in response to sluggish demand, consumers are suffering from ‘discount fatigue’ by this point in the year, to the detriment of Black Friday and Cyber Monday.
According to Accenture, almost two thirds of UK adults are planning to spend less this Christmas, a trend that likely to weigh on Black Friday too. The survey also found that more than half of UK adults would not take part in Black Friday, Cyber Monday, or Boxing Day sales.
For the increasing number of price sensitive consumers, second-hand retailers are likely to benefit as shoppers go bargain hunting for deals in charity shops and online via platforms like eBay and Vinted. More and more retailers are opening their own second-hand clothing or rental departments to benefit from this shift.”
Here are more photos from the GMB union picket line outside Amazon’s site in Coventry early this morning:
Updated
Germany confirmed on brink of recession
We have confirmation that Europe’s largest economy is on the brink of recession.
Updated data shows that Germany’s GDP shrank by 0.1% in July-September, matching the initial reading.
Ruth Brand, president of the Federal Statistical Office, says:
“After the weak development in the first half of the year, the German economy started the second half of 2023 with a slight decline.”
This follows stagnation in January-March, and 0.1% gowth in April-June.
#Germany GDP in 3Q2023: -0.1%Q, -0.8%Y, household final #consumption expenditure down, foreign #trade decreased, economic performance in #industry -3.8%Y, chart @destatis https://t.co/TYHdeunb3j pic.twitter.com/BDTgvJQSAK
— ACEMAXX ANALYTICS (@acemaxx) November 24, 2023
Today’s data will do very little to end the debate on whether or not the German economy is again the sick man of Europe, says Carsten Brzeski, global head of macro at ING.
Brzeski adds:
In any case, the German economy has become one of the growth laggards of the eurozone.
This weak growth performance has a long list of explanations: there is the cyclical headwind stemming from inflation, still elevated energy prices and energy uncertainty, higher interest rates and China’s changing role from being a flourishing export destination to being a rival that needs fewer German products. But there are also well-known structural challenges, ranging from demographics to energy transition and not enough investment.
German trade union Verdi has called on members to go on strike at five Amazon distribution centres across Germany on Black Friday.
Silke Zimmer, the member for retail on Verdi’s governing board, said:
“Amazon employees have decided to rename Black Friday ‘Make Amazon Pay Day’”.
Verdi said work will come to a standstill from Thursday’s night shift and throughout Friday, with centres in Koblenz, Leipzig, Rheinberg, Dortmund and Bad Hersfeld affected.
This is part of a dispute that began in 2013 over Amazon’s refusal to recognise industry-wide pay agreements.
A spokesperson for Amazon said participation in the strike was low and the vast majority of colleagues were working as normal, meaning customers will receive orders punctually.
Updated
Amazon workers stage Black Friday walkout at Coventry
Some Amazon workers in the UK are on strike today to coincide with Black Friday – which is typically one of the company’s busiest shopping days of the year.
More than 1,000 staff at the firm’s warehouse in Coventry are expected to take part in the walkout, the GMB union said, amid a long-running dispute over pay and conditions.
Some people have already gathered at a picket line outside the site.
A protest will also be held outside Amazon’s UK head office in London.
Strikes and demonstrations are also being held in other European countries and the US, which unions say will be the biggest day of action in Amazon’s history.
Amazon insists consumers won’t see any disruption, and that its pay rates were well above the National Living Wage and the voluntary Real Living Wage, while benefits included private medical insurance, life assurance, subsidised meals and an employee discount
An Amazon spokesperson says:
“We regularly review our pay to ensure we offer competitive wages and benefits.
By April 2024, our minimum starting pay will have increased to £12.30 and £13 per hour depending on location, that’s a 20% increase over two years and 50% since 2018.
But Amanda Gearing, GMB organiser, called the walkout an “unprecedented and historic moment”.
Gearing adds:
“Amazon has lost nearly thirty days to strike action in the UK this year alone.
“Despite that, Amazon bosses are desperate to claim it will be business as usual for Amazon and Amazon customers this Black Friday.
“The truth is that this Black Friday will see the largest day of industrial disruption in Amazon’s thirty-year history.
“Coventry is the beating heart of Amazon’s distribution network; strike action on Black Friday will ripple throughout the company’s UK logistics.
“With industrial action escalating and workers joining strike action in Europe and the USA, it’s clear that Coventry workers are inspiring Amazon workers worldwide to fight for their share of company profits.”
Staff in Coventry have held other strikes days already this autumn, In January, workers at the site – who have complained that they have been treated “like robots” – began a strike, the first time the corporation has faced industrial action in the UK.
Updated
Introduction: UK consumer confidence picks up as Black Friday begins
Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.
UK consumer morale has jumped this month as inflation eases, giving retailers hopes that people will come out to spend as they make their Black Friday pitches today.
Market research firm GfK’s index of consumer confidence, just released has bounced in November, hitting -24 from -30.
People grew more optimistic about their personal financial situation, and the wider economic outlook, GfK explains.
Although it remains in negative territory, this recovers most of last month’s drop.
Joe Staton, client strategy director at GfK, says:
“Consumer confidence strengthened in November with improvements across all measures. Recent ups and downs in confidence have underlined the nation’s topsy-turvy economic mood as encouraging news about falling inflation and wage growth is offset by high personal taxation, alongside costly fuel and energy bills.
Although the Overall Index Score is still tracking firmly in negative territory, it is good to see that consumers are more optimistic about their personal financial situation.
This pick-up in consumer confidence could give the UK economy a much-needed pick-up, after growth stagnated in the third quarter of the year.
But analysts have predicted that Black Friday will be quieter than in previous years, as the cost of living crisis continues to hit household budgets.
PwC predicted last week that UK spending for Black Friday – when retailers offer discounts to spur festive spending – could fall by almost a quarter, to £5.6bn from the £7.1bn forecast in 2022.
A PwC survey found that interest in Black Friday has waned. It says:
The research shows that the greatest interest is from under-45s and Black Friday shopping continues to be predominantly an online phenomenon. Even so, interest for the under-45s has dropped by between 15 and 20 percentage points.
This year interest levels have also equalised between men and women, with men having been more enthusiastic Black Friday shoppers in the past. Overall, the proportion who don’t intend to buy at all has increased from 39% in 2022 to 56% in 2023.
Also coming up today
Music store HMV is making a Black Friday return to its former store on London’s Oxford Street after a four-year absence. It will be selling vinyl, clothing and merchandise from the site at 363 Oxford Street again.
In Sunderland, Japanese carmaker Nissan is announing plans to build electric versions of three vehicles at its UK plant. Nissan is investing over £1.1bn in the transition, which will see electric versions of the Qashqai and Juke, and a new version of its electric Leaf vehicle.
The agenda
7am GMT: German Q3 GDP report (final estimate)
9am GMT: IFO survey of Germany’s business climate
2.45pm GMT: ‘Flash’ PMI survey of US manufacturing and services
Updated
